The Government is today publishing a paper on Ultra-Low Sulphur Diesel (ULSD), copies of which have been placed in the libraries of both Houses of Parliament. The paper outlines the environmental objectives behind the switch to ULSD and explains how the ULSD experience has worked.
In his foreword to the paper, Using the tax system to encourage cleaner fuels: the experience with ULSD, Treasury Minister Stephen Timms says:
“Many people and businesses rely on road transport as a vital part of their everyday lives and activity, particularly in rural areas. But road transport is also one of the main causes of local air pollution, particularly in urban areas.
“Since the Chancellor announced his Statement of Intent on Environmental Taxation in Budget 97, we have successfully used the tax system to achieve environmental objectives. Improving local air quality has been at the heart of our policy-making on transport taxation.
“Between 1997 and 1999, the rate of fuel duty for Ultra-Low Sulphur Diesel was steadily cut relative to conventional diesel. In the space of two years, these duty differentials succeeded in converting the entire diesel market to the cleaner fuel, cutting emissions of the most damaging local air pollutants and enabling the introduction of new, pollution-reducing technology.”
NOTES FOR EDITORS
1. The publication of the paper was announced by the Financial Secretary to the Treasury, Stephen Timms, in response to a written Parliamentary Question from Huw Edwards MP (Monmouth). The full text of the Parliamentary Question is attached.
2. The Government is committed to tackling local air pollution, particularly emissions of particulates and nitrogen oxides, which are associated with damaging health effects, and of which road transport is the biggest single source. Compared to normal diesel, ULSD - which can be used in any standard diesel vehicles - offers significant reductions of particulate and nitrogen oxide emissions, and enables the introduction of new pollution-reducing engine and exhaust technology.
3. From 1997-1999, the increase of the duty differential in favour of ULSD from 1p to 3p per litre converted the diesel market to ULSD, delivering significant emissions savings (including an 8% reduction in urban particulate emissions) and stimulating the development of new pollution-reducing technology by diesel vehicle manufacturers.
4. On 1 October the Government introduced a 1p differential for Ultra- Low Sulphur Petrol as announced in Budget 2000. ULSP can be used in all vehicles that use unleaded petrol.
5. Copies of Using the tax system to encourage cleaner fuels: the experience with ULSD are available from The Public Enquiry Unit, HM Treasury, Parliament Street, London SW1P 3AG (020 7270 4558) or from The Oils Team, HM Customs and Excise, 3rd Floor West, Ralli Quays, 3 Stanley Street, Salford M60 9LA (0161 827 0320), or on the Internet at http://www.hmce.gov.uk and http://www.hm-treasury.gov.uk.
For further details, please contact Vickie Sheriff in
the Treasury Press Office on 020 7270 4420.